Changes to Casual Employment – Industrial Relations Reforms
- On 26 March 2021, the Fair Work Act 2009 (Cth) (FW Act) was amended to make significant changes to casual employment, which affects every employer in Australia with over 15 employees.
- If you are an employer with existing casual employees (and you are not a small business employer), you should undertake an assessment now as to whether your casual employees are eligible for casual conversion.
On 26 March 2021, the Fair Work Act 2009 (Cth) (FW Act) was amended to make significant changes to casual employment, which affects every employer in Australia with over 15 employees.
The amendments created a new obligation for employers to proactively offer eligible casuals the opportunity to convert to permanent employment, whilst also allowing eligible employees to request conversion.
Employers who are not small business employers (i.e., with over 15 employees), need to ensure that they are aware of these changes.
Under the recent amendments, all casual employees who have been employed for 12 months or more, may now be eligible to convert to permanent employment. Prior to these changes, only casual employees covered by a Modern Award were entitled to this conversion.
The National Employment Standards now require an employer (who is not a small business employer) to offer eligible casual employees the opportunity to convert to permanent employment in certain circumstances.
For casual employees employed prior to 27 March 2021, this offer needs to be made by 27 September 2021. Otherwise, for casual employees employed after 27 March 2021, this needs to be done within 21 days of the casual employee reaching their 12-month anniversary.
For casual employees (of employers who employ 15 or more employees) to be eligible for casual conversion, the employers need to consider whether the employees have:
- been employed for at least 12 months at the time of assessment (which for existing casual employees is 6 September 2021); and
- during at least the last 6 months of that period, worked a regular pattern of hours on an ongoing basis which, the employee could continue to work as a full-time employee or a part-time employee (as the case may be) without significant adjustment.
If the above eligibility for conversion is satisfied, the casual employees must be offered conversion to permanent employment in writing from the employer, unless an exclusion applies.
An employer does not have to make an offer of permanent employment to a casual employee if the employer has ‘reasonable business grounds’ to not do so.
An eligible casual employee is also able to request conversion to permanent employment. There is also certain criteria that must be followed in this instance.
If you are an employer with existing casual employees (and is not a small business employer), you should undertake an assessment now as to whether your casual employees are eligible for casual conversion.
If you have any questions or need advice and clarity specific to your business, feel free to contact Semmens & Co on 03 8320 0320 for a free consultation.